R & D Strategy is one important key to the company in gaining competitive advantage and win the competition in the market. How your company can conduct R & D strategy well?
Research & Development (R & D), based on the definition of the Organization for Economic Cooperation and Development (OECD) is “creative work undertaken systematically in order to increase knowledge, including knowledge of man, culture and society, and use this knowledge to new innovations”
Why R & D Important?
R & D strategy becomes an important key to the success of the company, it can even be one of competitive advantage. Along with the evolving changes in the industry and markets, then the R & D becomes increasingly necessary. Research needs to be done to determine changes in customer preferences, to further the company do further research on how the product and design that is suitable for customers. R & D enables innovation, which in turn make the company a competitive advantage in the industry.
The advantages of R & D is due to the strong research, making the products and services provided is exactly what is required by the customer. Strong research also allows companies have qualified technology in producing a superior product in the industry.
Larger companies usually do not hesitate to invest a lot into R & D, because of their expectation to produce a lot of payoff, too. Examples are the pharmaceutical companies, which is very intensive in conducting R & D. Risk of failure is great, but if R & D success spawned a successful drug product, then payoffnya also unusually large.
However, R & D is not just trying to develop a superior product alone, but also research and develop new markets and marketing techniques. For example in the 80s, used to giants like IBM, Apple, HP and Compaq’s market lead. From them, all spend billions of dollars to produce superior products and advanced production techniques. However, later defeated by a Dell PC industry, which offers a very different marketing methods, namely direct selling in which Dell sells directly to the house and come to your home or office to repair a broken PC. So, the point is not only a purely research and product development to watch for, but also research on market opportunities, marketing techniques, and so forth.
In general, the ratio of R & D in companies in the U.S. is about 3.5% of revenues. However, for high tech companies like computer manufacturers, R & D budget it could reach 7%. In fact, a number of leading pharmaceutical companies such as Merck or Novartis, R & D budget it can be around 15%.
Recession that occurred some time ago did not make companies reduce R & D expenditure Based on Global Innovation 1000 study, more than two-thirds of companies that maintain disurveinya materials R & D budget increase in 2008, although about a third of companies reported a financial loss. This is because R & D is seen as an important strategy of the company. More than 90% of the companies surveyed executives think innovation is vital because as a preparation to face the global economic recovery.
R & D Strategy Tips
In short, there are several elements required in creating an R & D strategy is good:
• Specific
Statement of R & D strategy should be specific and can be directly implemented. This statement is in addition to mentioning the scope of R & D focus should also be given specific constraints. Focus R & D needs to clear, because if too wide then the danger because the company could lose direction.
• Aligned with Business Strategy
R & D strategy should be aligned with business strategy, so that the implementation of R & D can achieve the business objectives to be achieved, both in the short term and long term. If R & D are not aligned with business strategy, this course will not provide value added, and the company will only become a burden alone.
• R & D Included in the Strategic Planning
R & D strategy is not just a mere statement, but must be entered in a strategic planning process. In the process, the designers discuss strategy and work together to devise a strategy of R & D, so he could become a strong foundation in the implementation of R & D later.
• R & D Strategy for Comprehensive
Strategy R & D should not only fixated on the main activities related directly to the R & D such as product development, technology, etc., but also activities that are non-development such as change, systems implementation (project management, performance evaluation, etc.), skills and capabilities, to organizational culture (innovation, teamwork, etc.), marketing, and others. These activities have an important role in keeping the organization a competitive advantage.
• Simple and Easy Strategies Self Understood
R & D strategy, although comprehensive, must be spelled out so easily understood. R & D strategy must be understood by the general logic of thinking, so that communication to employees can also be done more easily. If the strategy easy to understand, of course, employees also can develop more creative strategies to then implement them.
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